Maynilad Water Services, Inc. has selected a consortium managed by a unit of DMCI Holdings, Inc. The purpose of this is to construct a 150-million-liter-per-day (MLD) plant that will supply water from Laguna Lake. First Pacific Co. Ltd. stated that the service contract was entered into with AA-DMCI Laguna Lake Consortium last January 28, 2019. This project looks interesting. Will it affect the stock performance of Maynilad? Will this event scale up both Maynilad and DMCI? Let’s stay tuned!
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According to Maynilad, the scope of the work under the 150-MLD Water Treatment Plant project includes the provision of engineering design, supply, construction, and installation of electrochemical equipment or process units, commissioning, testing, and process-proving of the facility. First Pacific Co. Ltd owned 51.3% interest in Maynilad Water Holding Co., Inc. (MWHC), making it the holding company of Maynilad incorporated in the country. Meanwhile, DMCI Holdings has 27.2% shares in MWHC. This is evidence that DMCI is an entity connected to First Pacific. AA-DMCI is a joint entity by DMCI Holdings unit D.M. Consunji and Acciona Agua, S.A in Spain. The service contract of the 150-MLD water project was given to AA-DMCI.
First Pacific has not yet disclosed the cost of the project and it’s still in the process of preparing such a statement. The holding company also said that the installation of an intake system and brine discharge system in Laguna Lake to be treated as a pumping station and water reservoir. This facility will then be connected to the distribution network. The service contract under the names of Maynilad and DMCI will contain the terms and conditions of the partnership between the two companies including the contract price, terms of payment, project milestone, the scope of work, and confidentiality.
First Pacific also disclosed that the service contract includes 1,679 calendar term days from January 28, 2020, until the date when the performance certificate will be issued. It should comprise the initial period when the project will start. The defects notification will then have a period of 730 days which runs simultaneously with the 365-day process-proving period. Maynilad is a water concessionaire serving cities in Maynila except for Sta. Ana and San Andres. It services Quezon City west of San Juan River, EDSA Congressional, West Avenue, Mindanao Avenue, Holy Spirit, and Batasan Hills.